Sterling down on housing while dollar surges to brief peak

Story link: Sterling down on housing while dollar surges to brief peak

Sterling was down 0.8 percent in relation to the dollar to $1.8340 at mid-afternoon on Monday. It was also down in relation to the euro, to fall 0.9 percent to £0.6880.

These losses have to do with a report that the growth in prices for British homes has fallen to an annual rate of 4.9 percent. This is down from 7 percent, and is the lowest growth level since 2002.

The US dollar managed to hit a seven-month high in relation to the euro in early trading, when it rose to $1.2582.

By mid-afternoon, though, it had fallen back to $1.2625, 0.1 percent off of Friday’s close. The dollar had been rising due to last week’s good US economic news. However, a report issued Monday morning said that net capital inflows into the US had fallen to the lowest level since October 2003.

This created worries concerning how the U.S. will fund its deficits. The dollar rose in relation to the yen, though, to ¥107.10 at mid-afternoon. It had been even higher, to ¥107.79, earlier in the day. The yen is still weak amid speculation about China’s possible revaluation of its currency.